TERMS AND CONDITIONS FOR OVAKO AB (PUBL) EUR 310,000,000 SENIOR SECURED FIXED RATE NOTES ISIN: SE0010413997 COMMON CODE: 168820054 No action is being taken that would or is intended to permit a public offering of the Notes or the possession, circulation or distribution of this document or any other material relating to the Issuer or the Notes in any jurisdiction other than Sweden, where action for that purpose is required. Persons into whose possession this document comes are required by the Issuer to inform themselves about, and to observe, any applicable restrictions.
TABLE OF CONTENTS 1. DEFINITIONS AND CONSTRUCTION... 1 2. STATUS OF THE NOTES... 15 3. USE OF PROCEEDS... 16 4. CONDITIONS FOR DISBURSEMENT... 16 5. ESCROW OF PROCEEDS... 17 6. CONDITIONS SUBSEQUENT... 18 7. NOTES IN BOOK-ENTRY FORM... 19 8. RIGHT TO ACT ON BEHALF OF A NOTEHOLDER... 19 9. PAYMENTS IN RESPECT OF THE NOTES... 20 10. INTEREST... 21 11. REDEMPTION AND REPURCHASE OF THE NOTES... 21 12. TRANSACTION SECURITY AND GUARANTEES... 24 13. INFORMATION TO NOTEHOLDERS... 26 14. GENERAL UNDERTAKINGS... 27 15. INCURRENCE TEST... 31 16. ACCELERATION OF THE NOTES... 32 17. DISTRIBUTION OF PROCEEDS... 34 18. DECISIONS BY NOTEHOLDERS... 35 19. NOTEHOLDERS MEETING... 39 20. WRITTEN PROCEDURE... 39 21. AMENDMENTS AND WAIVERS... 40 22. APPOINTMENT AND REPLACEMENT OF THE AGENT... 40 23. APPOINTMENT AND REPLACEMENT OF THE ISSUING AGENT... 44 24. APPOINTMENT AND REPLACEMENT OF THE CSD... 44 25. NO DIRECT ACTIONS BY NOTEHOLDERS... 44 26. PRESCRIPTION... 45 27. NOTICES AND PRESS RELEASES... 45 28. FORCE MAJEURE AND LIMITATION OF LIABILITY... 46 29. GOVERNING LAW AND JURISDICTION... 47 (i)
1. DEFINITIONS AND CONSTRUCTION 1.1 Definitions In these terms and conditions (the Terms and Conditions ): Account Operator means a bank or other party duly authorised to operate as an account operator pursuant to the Financial Instruments Accounts Act and through which a Noteholder has opened a Securities Account in respect of its Notes. Accounting Principles means the international financial reporting standards (IFRS) within the meaning of Regulation 1606/2002/EC. Additional Amounts has the meaning set forth in Clause 9.5. Adjusted Nominal Amount means the Total Nominal Amount less the Nominal Amount of all Notes owned by a Group Company and their Affiliates, irrespective of whether such person is directly registered as owner of such Notes. Affiliate means any other person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified person. For the purpose of this definition, control when used with respect to any person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms controlling and controlled have meanings correlative to the foregoing. Agency Agreement means the agency agreement entered into on or before the First Issue Date, between the Issuer and the Agent, or any replacement agency agreement entered into after the First Issue Date between the Issuer and an agent. Agent means Nordic Trustee & Agency AB (publ), Swedish Reg. No. 556882-1879, or another party replacing it, as Agent, in accordance with these Terms and Conditions. Applicable Premium means an amount equal to: (i) (ii) the present value on the relevant redemption date of 102.50 per cent. of the Nominal Amount as if such payment had taken place on the First Call Date; plus the present value on the relevant redemption date of the remaining interest payments (excluding accrued but unpaid interest up to the relevant redemption date) up to and including the First Call Date, both calculated by using a discount rate of 50 basis points above the comparable German Government Bond Rate (i.e. comparable to the remaining duration of the Notes from the relevant redemption date until the First Call Date using linear interpolation), provided that if the German Government Bond Rate is negative it will be set to zero, minus (iii) the Nominal Amount. The Applicable Premium shall be calculated and determined by the Issuer. Business Day means a day both (i) in Sweden other than a Sunday or other public holiday. Saturdays, Midsummer Eve (Sw. midsommarafton), Christmas Eve (Sw. julafton) and New Year s Eve (Sw. nyårsafton) shall for the purpose of this definition be deemed to be public holidays, and (ii) on which the Trans-European Automated Real-Time Gross
Settlement Express Transfer (TARGET2) System (the TARGET2 System ) or any successor system is open. Business Day Convention means the first following day that is a Business Day. Change of Control Event means: (i) (ii) at any time prior to an IPO Event, that the Sponsor ceases to own, directly or indirectly, more than 50 per cent. of the shares or voting rights of the Issuer; and upon and at any time following an IPO Event, any event where any other person or group of persons acting in concert (save for the Sponsor) owns or controls 50 per cent. or more shares or voting rights of the Issuer. Co-Investment Scheme means any scheme under which certain officers, employees or parties of the Sponsor or its adviser or manager are entitled (as individuals or through a body corporate or any other vehicle) to acquire shares which the Sponsor would otherwise acquire. Compliance Certificate means a certificate, in form and substance reasonably satisfactory to the Agent, signed by the Issuer. Condition Subsequent Security means the Security provided in accordance with Clause 6 for the Secured Obligations pursuant to the Security Documents. CSD means the Issuer s central securities depository and registrar in respect of the Notes, Euroclear Sweden AB, Swedish Reg. No. 556112-8074, P.O. Box 191, 101 23 Stockholm, Sweden, or another party replacing it, as CSD, in accordance with these Terms and Conditions. CSD Regulations means the CSD s rules and regulations applicable to the Issuer, the Agent and the Notes from time to time. Disbursement Date means the date of the disbursement of the Net Proceeds of the Initial Notes Issue from the Escrow Account. Distribution means any (i) payment of dividend on shares, (ii) repurchase of own shares, (iii) redemption of share capital or other restricted equity with repayment to shareholders, (iv) repayment or service of any Subordinated Loans, (v) repayment of principal or interest under any shareholder debt or (vi) other similar distributions or transfers of value to the direct and indirect shareholders of any Group Company or the Affiliates of such direct and indirect shareholders. EBITDA means, in respect of the Relevant Period, the consolidated profit of the Group from ordinary activities according to the latest Financial Report(s), adjusted as follows, without duplication: (a) (b) (c) before deducting any amount of tax on profits, gains or income paid or payable by any member of the Group; before deducting any Net Finance Charges; adding back any negative and deducting any positive items of a one off, nonrecurring, non-operational, extraordinary, unusual or exceptional nature (including, 2
without limitation, restructuring expenditures), provided that such negative items in no event shall exceed an aggregate amount of fifteen (15) per cent. of EBITDA in respect of the Relevant Period; (d) (e) (f) (g) (h) (i) (j) after deducting the amount of any profit (or adding back the amount of any loss) of any member of the Group which is attributable to minority interests; before taking into account any unrealised gains or losses on any derivative instrument (other than any derivative instruments which are accounted for on a hedge account basis); before taking into account any Pension Items; after adding back any losses to the extent covered by any insurance; after adding back the amount of acquisition costs relating to any stock based compensation made to departing management and costs or provisions relating to share incentive schemes of the Group to the extent deducted; after adding back or deducting, as the case may be, the amount of any loss or gain against book value arising on a disposal of any asset (other than in the ordinary course of trading) and any loss or gain arising from an upward or downward revaluation of any asset; and after adding back any amount attributable to the amortisation, depreciation or depletion of assets of members of the Group. Escrow Account means the interest bearing bank account held by the Issuer with the Escrow Bank for the purpose of the arrangement specified in Clause 5 (Escrow of proceeds). Escrow Account Pledge Agreement means the agreement for Security over the funds standing to the credit on the Escrow Account, entered into between the Issuer and the Agent. Escrow Bank means Nordea Bank AB (publ). Euro and EUR means the single currency of the participating member states in accordance with the legislation of the European Community relating to Economic and Monetary Union. Event of Default means an event or circumstance specified in Clause 16.1. Existing Debt means the Existing Notes, the EUR 40,000,000 multicurrency revolving facility originally dated 20 May 2014 (as amended or restated from time to time) for, amongst others, the Issuer as borrower and the SEK 440,000,000 pension insurance line facility agreement originally dated 20 May 2014 (as amended or restated from time to time) for the Issuer as borrower. Existing Notes means all amounts outstanding under the Issuer s EUR 300,000,000 6.500 per cent. senior secured notes due 2019. Final Maturity Date means 5 October 2022. 3
Finance Charges means, for the Relevant Period, the aggregate amount of the accrued interest, commission, fees (excluding arrangement fees in respect of the Nominal Amount under a Notes Issue and any fees, costs, premium in relation to the refinancing of the Existing Debt), discounts, payment fees, premiums or charges and other finance payments in respect of Financial Indebtedness whether paid, payable or capitalised by any member of the Group according to the latest Financial Report(s) (calculated on a consolidated basis), without taking into account any capitalised interest in respect of any Subordinated Loan, or any unrealised gains or losses on any derivative instruments other than any derivative instruments which are accounted for on a hedge accounting basis. Finance Documents means these Terms and Conditions, the Security Documents, the Guarantee Agreement, the Escrow Account Pledge Agreement, the Intercreditor Agreement and any other document designated by the Issuer and the Agent as a Finance Document. Finance Lease means any lease or hire purchase contract entered into by a Group Company which would have been treated as a finance or capital lease for accounting purposes in accordance with IFRS as applicable on the First Issue Date. Financial Indebtedness means any indebtedness in respect of: (a) (b) (c) (d) (e) (f) (g) (h) (i) moneys borrowed and debt balances at banks or other financial institutions; any amount raised by acceptance under any acceptance credit facility or dematerialized equivalent; any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument, including the Notes; the amount of any liability in respect of any Finance Lease; receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis provided that the requirements for de-recognition under IFRS are met); any derivative transaction entered into and, when calculating the value of any derivative transaction, only the marked to market value (or, if any actual amount is due as a result of the termination or close-out of that derivative transaction, that amount shall be taken into account); any counter-indemnity obligation in respect of a guarantee, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution in respect of an underlying liability of a person which is not a Group Company which liability would fall within one of the other paragraphs of this definition; any amount raised by the issue of redeemable shares which are redeemable (other than at the option of the Issuer) before the Final Maturity Date or are otherwise classified as borrowings under IFRS; any amount of any liability under an advance or deferred purchase agreement, if (a) the primary reason behind entering into the agreement is to raise finance or (b) the agreement is in respect of the supply of assets or services and payment is due more than 120 calendar days after the date of supply; 4
(j) (k) any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing or otherwise being classified as a borrowing under IFRS; and without double counting, the amount of any liability in respect of any guarantee for any of the items referred to in paragraphs (a) to (j) above, but, for the avoidance of doubt, excluding all pension-related liabilities. Financial Instruments Accounts Act means the Swedish Financial Instruments Accounts Act (lag (1998:1479) om kontoföring av finansiella instrument). Financial Report means the annual audited consolidated financial statements of the Group and the quarterly interim unaudited consolidated reports of the Group. First Call Date means the date falling twenty four (24) months after the First Issue Date. First Issue Date means 5 October 2017. Floating Charge Pledge Agreements means the Swedish law floating charge pledge agreements and Finnish law agreements on business mortgage in respect of the floating charges and business mortgages set out in Schedule 2 hereto. Force Majeure Event has the meaning set forth in Clause 28.1. German Government Bond Rate means the yield to maturity at the time of computation of direct obligations of the Federal Republic of Germany (Ge. Bund or Bundesanleihen) with a constant maturity (as officially compiled and published in the most recent financial statistics that have become publicly available at least two (2) Business Days (but not more than five (5) Business Days) prior to the redemption date (or, if such financial statistics are not so published or available, any publicly available source of similar market data selected by the Issuer in good faith)) most nearly equal to the period from the relevant redemption date to (but excluding) the First Call Date, provided, however that if the period from the relevant redemption date to (but excluding) the First Call Date is not equal to the constant maturity of the direct obligations of the Federal Republic of Germany for which a weekly average yield is given, the German Government Bond Rate shall be obtained by a linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of direct obligations of the Federal Republic of Germany for which such yields are given, except that if the period from such redemption date to (but excluding) the First Call Date is less than one year, the weekly average yield on actually traded direct obligations of the Federal Republic of Germany adjusted to a constant maturity of one year shall be used. Group means the Parent and the Issuer and its Subsidiaries from time to time (each a Group Company ). Guarantee means the guarantees in relation to certain obligations under the Finance Documents provided by the Guarantors pursuant to the Guarantee Agreement. Guarantee Agreement means the guarantee agreement entered into between the Issuer, each Guarantor and the Security Agent pursuant to which the Issuer s obligations under the Finance Documents towards the Noteholders and the Agent will be guaranteed by the Guarantors. 5
Guarantor means the Parent and each Group Company which, at any point in time, is a party to the Guarantee Agreement. Incurrence Test means the test pursuant to Clause 15.1 (Incurrence Test). Initial Guarantor means the Parent, Ovako Sweden AB, Ovako Bar AB, Ovako Finland Oy Ab, Ovako Imatra Oy Ab and Triako Finco AB. Initial Nominal Amount has the meaning set forth in Clause 2.3. Initial Notes means the Notes issued on the First Issue Date. Initial Notes Issue means the issue of the Initial Notes. Insolvent means, in respect of a relevant person, that it is deemed to be insolvent, or admits inability to pay its debts as they fall due, in each case within the meaning of Chapter 2, Sections 7-9 of the Swedish Bankruptcy Act (konkurslagen (1987:672)) (or its equivalent in any other jurisdiction), suspends making payments on any of its debts or by reason of actual financial difficulties commences negotiations with all or substantially all of its creditors (other than the Noteholders and creditors of secured debt) with a view to rescheduling any of its indebtedness (including company reorganisation under the Swedish Company Reorganisation Act (lag (1996:764) om företagsrekonstruktion) (or its equivalent in any other jurisdiction)) or is subject to involuntary winding-up, dissolution or liquidation. Interest means the interest on the Notes calculated in accordance with Clauses 10.1 to 10.3. Intercreditor Agreement means the intercreditor agreement dated on or about the date hereof between the Parent, the Issuer, the Guarantors, the Secured Parties and the Agent acting as security agent on behalf of the Secured Parties. Interest Coverage Ratio means the ratio of EBITDA to Net Finance Charges. Interest Payment Date means 5 April and 5 October of each year or, to the extent such day is not a Business Day, the Business Day following from an application of the Business Day Convention. The first Interest Payment Date for the Notes shall be 5 April 2018 and the last Interest Payment Date shall be the relevant Redemption Date. Interest Period means (i) in respect of the first Interest Period, the period from (but excluding) the First Issue Date to (and including) the first Interest Payment Date, and (ii) in respect of subsequent Interest Periods, the period from (but excluding) an Interest Payment Date to (and including) the next succeeding Interest Payment Date (or a shorter period if relevant). An Interest Period shall not be adjusted due to an application of the Business Day Convention. Interest Rate means 5.00 per cent. per annum. Intra-Group Loan Pledge Agreements means the pledge agreements entered into between the relevant Material Group Company and the Security Agent (acting on behalf of the Secured Parties), in respect of first priority pledges of all Material Intra-Group Loans, granted in favour of the Secured Parties (represented by the Security Agent). 6
IPO Event means an initial public offering of the shares in either the Issuer or the Parent. IP-Rights Pledge Agreements means the patents and trademarks pledge agreements and trademarks pledge agreement in respect of the patents and trademarks set out in Schedule 3 hereto. Issuer means Ovako AB (publ), a public limited liability company incorporated under the laws of Sweden with Reg. No. 556813-5338. Issuing Agent means Nordea Bank AB (publ), or another party replacing it, as Issuing Agent, in accordance with these Terms and Conditions and the CSD Regulations. Leverage Ratio has the meaning set forth in Clause 15.1(b). Listing Failure Event means that the Initial Notes are not admitted to trading on a Permitted Exchange within six (6) months following the First Issuing Date. Mandatory Redemption has the meaning set forth in Clause 5.4. Material Adverse Effect means a material adverse effect on (a) the business or the financial condition or operations of the Group taken as a whole (b) the Issuer's or any Guarantor's ability to perform and comply with its payment obligations under any of the Finance Documents, or (c) the validity or enforceability of any of the Finance Documents. Material Group Companies means the Issuer, the Parent and any Group Company who is nominated as such by the Issuer in accordance with Clause 14.14. Material Intra-Group Loans means any loan made by a Group Company to a Material Group Company (not including any Financial Indebtedness under any cash pooling arrangement of the Group) where (i) the term of the loan is in excess of one (1) year (the term being determined at the sole discretion of the Issuer) and (ii) the amount is in excess of EUR 1,000,000 (individually or when aggregated with any other loan made between the same Group Companies), and which pursuant to the Intercreditor Agreement shall be fully subordinated to the Secured Obligations. Mortgage Deeds Pledge Agreements means the mortgage deeds pledge agreements in respect of the mortgage deeds relating to the real properties set out in Schedule 4 hereto. Net Finance Charges means, for the Relevant Period, the Finance Charges according to the latest Financial Report(s), after deducting any interest payable for that Relevant Period to any member of the Group and any interest income relating to cash or cash equivalent investment. Net Interest Bearing Debt means the aggregate interest bearing Financial Indebtedness of the Group, excluding: (a) (b) (c) Subordinated Loans; interest bearing debt borrowed from any wholly-owned Group Company; and any Notes owned by the Issuer, 7
less cash and cash equivalents (including funds held on the Escrow Account) of the Group in accordance with IFRS. Net Proceeds means the gross proceeds from the offering of the relevant Notes, minus fees and legal costs of the Joint Bookrunners and any other costs and expenses incurred in connection with the Initial Notes Issue and the refinancing of the Existing Debt. New Debt means any new Financial Indebtedness incurred by the Issuer: (a) (b) in accordance with paragraph (k) of the definition of Permitted Financial Indebtedness; or upon refinancing with the Issuer as the new borrower in accordance with paragraph (l) of the definition of Permitted Financial Indebtedness, provided that such Financial Indebtedness meets the Incurrence Test, and ranks pari passu or is subordinated to the obligations of the Issuer under the Finance Documents, and has a final maturity date or a final redemption date or, when applicable, early redemption dates or instalment dates which occur after the Final Maturity Date. Nominal Amount means in respect of each Note the Initial Nominal Amount, less the aggregate amount by which that Note has been redeemed in part pursuant to Clause 11.3 (Voluntary redemption (call option)) and/or Clause 11.4 (Special redemption (call option)). Note means a debt instrument (skuldförbindelse) for the Nominal Amount and of the type set forth in Chapter 1 Section 3 of the Financial Instruments Accounts Act and which are governed by and issued under these Terms and Conditions, including the Initial Notes and any Subsequent Notes. Noteholder means the person who is registered on a Securities Account as direct registered owner (ägare) or nominee (förvaltare) with respect to a Note. Noteholders Meeting means a meeting among the Noteholders held in accordance with Clause 19 (Noteholders Meeting). Parent means Ovako Group AB, a private limited liability company incorporated under the laws of Sweden with Reg No. 556813-5361. Pension Items means any income or charge attributable to a post-employment benefit scheme other than the current service costs and any past service costs and curtailments and settlements attributable to the scheme. Permitted Distribution means any Distribution by: (a) (b) a Subsidiary of the Parent, if such Distribution is made to another Group Company and, if made by a Group Company which is not wholly-owned, is made pro rata to the Group s ownership percentage in such Subsidiary; the Parent or the Issuer following an IPO Event in relation to such entity, if (i) the Leverage Ratio is equal to or less than 3.50:1 for the Relevant Period (tested pro forma to reflect such Distribution and otherwise calculated as set out in the Incurrence Test), provided that the Parent or the Issuer, as applicable, has dividend capacity pursuant to applicable law (to the extent that such Distribution is made in the form of dividends), or (ii) if not permitted pursuant to sub-paragraph (i) above, if and to the extent necessary to comply with mandatory provisions of the Swedish 8
Companies Act relating to dividend distributions to minority shareholders, provided that, the Parent or the Issuer, as applicable, in such case shall ensure that any such dividends shall be paid at the lowest level allowed by applicable law; (c) (d) the Parent, if such Distribution consists of a group contribution, provided that no cash or other funds are transferred from the Parent as a result thereof (i.e. the group contributions are merely accounting measures), however so that group contributions made for tax netting purposes may be made by way of cash contributions, and provided that such distribution, net of the tax effect, is subsequently converted into or re-injected as a shareholder's contribution to the Parent as soon as practically possible; and the Parent for funding of administration and management costs limited to EUR 1,500,000 for any financial year, in each case provided that no Event of Default is continuing or would result from such Distribution. Permitted Exchange means any of (A) the Euro MTF market of the Luxembourg Stock Exchange, (B) the regulated market of NASDAQ Stockholm or, (C) if such admission to trading is unduly onerous to obtain or maintain, admitted to trading on another exchange regulated market or EU regulated market. Permitted Financial Indebtedness means any Financial Indebtedness (or the refinancing of any Financial Indebtedness): (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) incurred under the Finance Documents (except for Subsequent Notes); incurred under the RCF Finance Documents; incurred under the PIL Finance Documents; in the form of the Existing Debt provided that it is refinanced (and any related security is released) through the Initial Notes Issue, the RCF and the PIL on or before the initial release of any amount from the Escrow Account; in the form of any loans between Group Companies; in the form of any Subordinated Loans; arising between any Group Companies under any cash pooling arrangement of the Group; in the form of any Permitted Hedging Obligation; any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution in respect of an underlying liability in the ordinary course of business of a Group Company; incurred under any advance or deferred purchase agreement on normal commercial terms by any member of the Group from any of its trading partners in the ordinary course of its trading activities; 9
(k) (l) (m) (n) (o) (p) (q) (r) (s) incurred by the Issuer if the Incurrence Test is met tested pro forma including such incurrence, and (i) is in the form of Subsequent Notes or (ii) ranks pari passu or is subordinated to the obligations of the Issuer under the Finance Documents, and has a final maturity date or a final redemption date or, when applicable, early redemption dates or instalment dates which occur after the Final Maturity Date; incurred as a result of any Group Company acquiring another entity and which is due to such acquired entity holding indebtedness, provided that (i) the Incurrence Test is met, and (ii) such indebtedness is refinanced with the Issuer as the new borrower or repaid within 90 days of completion of such acquisition; under any pension and tax liabilities incurred in the ordinary course of business; arising from agreements of any Group Company providing for customary indemnification obligations in respect of earn-outs or other adjustments of purchase price or similar obligations (to the extent classified as financial indebtedness under IFRS), in each case incurred or assumed in connection with an acquisition, provided that the maximum liability of the Group in respect of all such Financial Indebtedness shall at no time exceed the gross proceeds, including the fair market value of non-cash proceeds (measured at the time received and without giving effect to any subsequent changes in value), actually received by the Group in connection with such disposal; arising as a result of a contemplated refinancing of the Notes in full provided that a call notice has been served on the Notes (in full); arising under any Finance Lease, provided that the aggregate capital value of all items leased under Finance Leases by any member of the Group does not at any time exceed EUR 10,000,000 (or its equivalent in other currencies); not otherwise permitted above which in aggregate shall not exceed EUR 10,000,000 (or its equivalent in other currencies); arising as a consequence of a distribution pursuant to paragraph (c) of the definition of Permitted Distribution; or under any guarantee for any of the items listed above other than those contained in paragraphs (f) and (r) above. Permitted Hedging Obligation means any obligation of any Group Company under a derivative transaction entered into with one or more hedging counterparties (each a Hedging Counterparty ) in connection with protection against or benefit from fluctuation in any rate or price, where such exposure arises in the ordinary course of business or in respect of payments to be made under the Terms and Conditions, the RCF Finance Documents, PIL Finance Documents or in relation to any New Debt (but not a derivative transaction for investment or speculative purposes). Permitted Security means any security: (a) (b) created under the Finance Documents; up until the Disbursement Date, any security provided under the Existing Debt; 10
(c) (d) (e) (f) (g) (h) (i) (j) (k) created in respect of the RCF Finance Documents, the PIL Finance Documents, any Permitted Hedging Obligation, or any New Debt, provided that such security is extended to and shared between the Secured Parties pursuant to the terms of the Intercreditor Agreement; arising by operation of law or in the ordinary course of trading and not as a result of any default or omission; arising in the ordinary course of banking arrangements for the purposes of netting debt and credit balances of Group Companies; in the form of rental deposits or other guarantees in respect of any lease agreement including in relation to real property entered into by a Group Company in the ordinary course of business and on normal commercial terms; incurred as a result of any Group Company acquiring another entity and which is due to such entity having provided security, provided that the debt secured with such security is Permitted Financial Indebtedness in accordance with paragraphs (k) or (l) of the definition of Permitted Financial Indebtedness and that such security is discharged upon refinancing with the Issuer as the new borrower or as a consequence of repayment of that Financial Indebtedness; affecting any asset acquired by any Group Company after the First Issue Date provided that: (i) such Security was not created in contemplation of the acquisition of such asset by a Group Company, (ii) the amount thereby secured has not been increased in contemplation of, or since the date of, the acquisition of such asset by a Group Company (other than as a result of capitalisation of interest, and (iii) such Security is released within 90 days of such acquisition; any Security granted to secure the obligations of any Group Company in respect of arrangements permitted under paragraph (o) of the definition of Permitted Financial Indebtedness; any Security created for the benefit of the finance providers in relation to a refinancing of the Notes in full, however provided always that any perfection requirements in relation thereto are satisfied after repayment of the Notes in full (other than with respect to an escrow account (if applicable) which may be perfected in connection with the incurrence of such debt); and not otherwise permitted above which secures debt in an amount not exceeding EUR 10,000,000 (or its equivalent in other currencies) at any time. Permitted Transfer means any transfer by a Sponsor of shares or other securities in the Parent or a holding company of the Parent to (i) any member of that Sponsor's Sponsor Group, or (ii) to any Co-Investment Scheme. PIL means a pension insurance line to be provided to the Issuer and any other Group Companies with an aggregate commitment of SEK 440,000,000 (or the equivalent amount in any other currency or currencies) as at the First Issue Date, which commitment is permitted to be increased to an aggregate maximum commitment of EUR 70,000,000 (or the equivalent amount in any other currency or currencies). PIL Finance Documents has the meaning ascribed to it in the Intercreditor Agreement. 11
PIL Finance Parties has the meaning ascribed to it in the Intercreditor Agreement. RCF means one or more revolving credit facilities to be provided to the Issuer and any other Group Companies with an aggregate maximum commitment of EUR 40,000,000 (or the equivalent amount in any other currency or currencies) as at the First Issue Date, which commitment is permitted to be increased to an aggregate maximum commitment of EUR 50,000,000 (or the equivalent amount in any other currency or currencies). RCF Finance Parties has the meaning ascribed to it in the Intercreditor Agreement. RCF Finance Documents has the meaning ascribed to it in the Intercreditor Agreement. Record Date means the fifth (5) Business Day prior to (i) an Interest Payment Date, (ii) a Redemption Date, (iii) a date on which a payment to the Noteholders is to be made under Clause 17 (Distribution of proceeds) or (iv) another relevant date, or in each case such other Business Day falling prior to a relevant date if generally applicable on the Swedish bond market. Redemption Date means the date on which the relevant Notes are to be redeemed or repurchased in accordance with Clause 11 (Redemption and repurchase of the Notes). Regulated Market means any regulated market (as defined in Directive 2004/39/EC on markets in financial instruments). Relevant Period means each period of 12 consecutive calendar months. Secured Obligations has the meaning ascribed to it in the Intercreditor Agreement. Secured Parties has the meaning ascribed to it in the Intercreditor Agreement. Securities Account means the account for dematerialised securities maintained by the CSD pursuant to the Financial Instruments Accounts Act in which (i) an owner of such security is directly registered or (ii) an owner s holding of securities is registered in the name of a nominee. Security means a mortgage, charge, pledge, lien, security assignment or other security interest securing any obligation of any person, or any other agreement or arrangement having a similar effect. Security Agent means Nordic Trustee & Agency AB (publ), Swedish Reg. No. 556882-1879, or another party replacing it, as Security Agent, in accordance with the Intercreditor Agreement. Security Documents means: (a) (b) (c) the Share Pledge Agreements; the Intra-Group Loan Pledge Agreements; the Floating Charge Pledge Agreements; 12
(d) (e) (f) (g) the IP-Rights Pledge Agreements; the Mortgage Deeds Pledge Agreements: any other pledge agreement entered into by a Group Company under these Terms and Conditions; and such further agreements, assignments, certificates, instruments, consents, acknowledgements, confirmations and other documents which relate thereto or which are required in order to establish, maintain, preserve, protect and perfect the pledge created or purported to be created under such documents. Share Pledge Agreements means each of the pledge or security agreements entered into by a Material Group Company and the Security Agent (acting on behalf of the Secured Parties): (a) (b) (c) on the Disbursement Date, in respect of first priority pledge of, or charge over, all of the Parent s shares in the Issuer; on or about the Disbursement Date, in respect of first priority pledges of, or charges over, all of the Group s shares in the Initial Guarantors (other than the Issuer and the Parent); and thereafter, in respect of first priority pledges of, or charges over, all shares at any time held by a Material Group Company in the capital of a Material Group Company becoming a Guarantor after the First Issue Date granted in favour of the Secured Parties in accordance with the Intercreditor Agreement. Sponsor means Triton Fund III and any person to whom they have made a Permitted Transfer. Sponsor Affiliate means any Sponsor, each of its Affiliates, any trust of which any Sponsor or any of its Affiliates is a trustee, any partnership of which any Sponsor or any of its Affiliates is a partner and any trust, fund or other entity which is managed by, or is under the control of, any Sponsor or any of its Affiliates, provided that any such trust, fund or other entity which has been established for at least six months solely for the purpose of making, purchasing or investing in loans or debt securities and which is managed or controlled independently from all other trusts, funds or other entities managed or controlled by any Sponsor or any of its Affiliates which have been established for the primary or main purpose of investing in the share capital of companies shall not constitute a Sponsor Affiliate. Sponsor Group means, in relation to a Sponsor: (a) (b) (c) (d) any group undertaking for the time being of that Sponsor; any Sponsor Affiliate of that Sponsor; any general partner, trustee or nominee of that Sponsor or any group undertaking for the time being of that Sponsor; and any manager or adviser or limited partner of a Sponsor or any group undertaking of that Sponsor for the time being, 13
in each case, other than a Group Company, and member of a Sponsor Group shall be construed accordingly. Subordinated Loan means any loan granted or to be granted to the Parent by any direct or indirect shareholders of the Parent, provided that (i) such loan is fully subordinated to the Secured Obligations in accordance with the Intercreditor Agreement and (ii) any repayment of, or payment of interest under, any such loan is subject to the terms of the Intercreditor Agreement. Subsequent Notes means any Notes issued after the First Issue Date on one or more occasions. Subsidiary means, in relation to any person, any Swedish or foreign legal entity (whether incorporated or not), which at the time is a subsidiary (dotterföretag) to such person, directly or indirectly, as defined in the Swedish Companies Act (aktiebolagslagen (2005:551)). Total Assets means, in respect of the Group, the book value of the total consolidated assets as shown in the most recent annual consolidated financial statements of the Group. Total Nominal Amount means the total aggregate Nominal Amount of the Notes outstanding at the relevant time. Transaction Security means the Security provided for the Secured Obligations pursuant to the Security Documents. Triton Fund III means Triton Managers III Ltd, acting on behalf of Triton Fund III General Partner L.P, in its turn acting for Triton Fund III L.P., Triton Fund III no. 2 L.P, Triton Fund III F&F No. 2 L.P., Triton Fund III F&F No. 3 L.P., Triton Fund III F&F No.4 L.P., Triton Fund III F&F G L.P., Triton Fund III German L.P., and TFF III Ltd acting on behalf of Triton III F&F L.P. Written Procedure means the written or electronic procedure for decision making among the Noteholders in accordance with Clause 20 (Written Procedure). 1.2 Construction 1.2.1 Unless a contrary indication appears, any reference in these Terms and Conditions to: (a) (b) (c) (d) (e) assets includes present and future properties, revenues and rights of every description; any agreement or instrument is a reference to that agreement or instrument as supplemented, amended, novated, extended, restated or replaced from time to time; a regulation includes any regulation, rule or official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, selfregulatory or other authority or organisation; a provision of law is a reference to that provision as amended or re-enacted; and a time of day is a reference to Stockholm time. 14
1.2.2 An Event of Default is continuing if it has not been remedied or waived. 1.2.3 A notice shall be deemed to be sent by way of press release if it is made available to the public within the European Economic Area promptly and in a non-discriminatory manner. 1.2.4 No delay or omission of the Agent or of any Noteholder to exercise any right or remedy under the Finance Documents shall impair or operate as a waiver of any such right or remedy. 1.2.5 In the event of a conflict between the terms of these Terms and Conditions and the Intercreditor Agreement as to the rights of the Agent, the Security Agent and/or the Noteholders in relation to any issues relating to the Transaction Security or the enforcement thereof, the Intercreditor Agreement shall prevail. 1.2.6 In connection with an IPO Event relating to the shares of the Issuer, all obligations stated to be undertaken by the Parent hereunder shall following such event be deemed to be the obligations of the Issuer. 2. STATUS OF THE NOTES 2.1 2.2 2.3 2.4 2.5 The Notes are denominated in Euro and each Note is constituted by these Terms and Conditions. The Issuer undertakes to make payments in relation to the Notes and to comply with these Terms and Conditions. By subscribing for Notes, each initial Noteholder agrees that the Notes shall benefit from and be subject to the Finance Documents and by acquiring Notes, each subsequent Noteholder confirms such agreement. The initial nominal amount of each Initial Note is EUR 100,000 (the Initial Nominal Amount ). The maximum aggregate nominal amount of the Initial Notes as at the First Issue Date is EUR 310,000,000. All Initial Notes are issued on a fully paid basis at an issue price of 100 per cent. of the Initial Nominal Amount. Provided that at the time of issuance, the Issuer meets the Incurrence Test (tested pro forma including such incurrence), the Issuer may, on one or several occasions, issue Subsequent Notes. Subsequent Notes shall benefit from and be subject to the Finance Documents, and, for the avoidance of doubt, the ISIN, the interest rate, the currency, the nominal amount and the final maturity applicable to the Initial Notes shall apply to Subsequent Notes. The issue price of the Subsequent Notes may be set at a discount or at a premium compared to the Nominal Amount. The maximum aggregate nominal amount of the Notes (the Initial Notes and all Subsequent Notes) may not exceed EUR 400,000,000 unless a consent from the Noteholders is obtained in accordance with Clause 18.7(a). Each Subsequent Note shall entitle its holder to Interest in accordance with Clause 10.1, and otherwise have the same rights as the Initial Notes. The Notes constitute direct, general, senior, unsubordinated and secured obligations of the Issuer and shall at all times rank pari passu and without any preference among them and, subject to the super senior status of (i) the RCF, (ii) the PIL and (iii) the Permitted Hedging Obligations as set out in the Intercreditor Agreement, at least pari passu with all other direct, unconditional, unsubordinated and secured obligations of the Issuer, except obligations which are preferred by mandatory law and except as otherwise provided in the Finance Documents. 15
2.6 2.7 2.8 2.9 2.10 Following an Acceleration Event (as defined in the Intercreditor Agreement) and for as long as it is continuing, no repayments, payments of Interest, repurchase of Notes or any other payments may be made by the Issuer or a Guarantor to the Noteholders under or in relation to the Notes or a Guarantee (notwithstanding any other provisions to the contrary in these Terms and Conditions) other than in accordance with the Intercreditor Agreement. In case of insolvency of the Issuer, the payment obligations of the Issuer under the Notes are subordinated to other payment obligations of the Issuer under the RCF, PIL and any Permitted Hedging Obligations in accordance with the Intercreditor Agreement. The Notes are freely transferable but the Noteholders may be subject to purchase or transfer restrictions with regard to the Notes, as applicable, under local laws to which a Noteholder may be subject. Each Noteholder must ensure compliance with such restrictions at its own cost and expense. The Notes have not been and will not be registered under the U.S. Securities Act of 1933 (as amended) (the U.S. Securities Act ) and may not be offered, sold, pledged or otherwise transferred, except outside the United States in an offshore transaction, as defined in, and meeting the requirements of, Regulation S under the U.S. Securities Act. No action is being taken in any jurisdiction that would or is intended to permit a public offering of the Notes or the possession, circulation or distribution of any document or other material relating to the Issuer or the Notes in any jurisdiction other than Sweden, where action for that purpose is required. Each Noteholder must inform itself about, and observe, any applicable restrictions to the transfer of material relating to the Issuer or the Notes. 3. USE OF PROCEEDS 3.1 3.2 The Net Proceeds of the Initial Notes Issue shall be applied by the Issuer towards the repayment in full of the Existing Debt and towards the general corporate purposes of the Group. The Issuer shall use the proceeds from the issue of any Subsequent Notes, for its and working capital purposes of the Group, including, but not limited to, capital expenditure and any acquisition not prohibited by the Terms and Conditions. 4. CONDITIONS FOR DISBURSEMENT 4.1 Disbursement of the Net Proceeds of the Initial Notes Issue to the Escrow Account will be subject to the following conditions precedent having been received by the Agent (no later than two Business Days prior to the First Issue Date): (a) (b) (c) (d) (e) a duly executed copy of the Terms and Conditions; a duly executed copy of the Agency Agreement; copies of the constitutional documents of the Parent and the Issuer; copies of all corporate resolutions (including authorisations) of each of the Parent and the Issuer required to execute the relevant Finance Documents to which it is a party; a Swedish law legal opinion from the legal advisers to the Joint Bookrunners addressed to the Agent; and 16
(f) the Escrow Account Pledge Agreement duly executed by all parties thereto and all documents to be delivered pursuant to such agreement (including all applicable notices, acknowledgements and consents from the account bank). 4.2 The Issuing Agent shall pay the net proceeds from the issuance of any Subsequent Notes to the Issuer on the later of (i) the date of the issue of such Subsequent Notes and (ii) the date on which the Agent notifies the Issuing Agent that it has received the following: (a) (b) (c) a copy of a resolution from the board of directors of the Issuer approving the issue of the Subsequent Notes and resolving to enter into documents necessary in connection therewith; a certificate from the Issuer confirming that no Event of Default is continuing or would result from the issue of the Subsequent Notes and that the Issuer meets the Incurrence Test tested pro forma including such incurrence; and such other documents and information as is agreed between the Agent and the Issuer. 4.3 4.4 The Agent may assume that the documentation delivered to it pursuant to Clause 4.1 or 4.2 is accurate, correct and complete unless it has actual knowledge that this is not the case, and the Agent does not have to verify the contents of any such documentation. The Agent shall confirm to the Issuing Agent when the conditions in Clause 4.1 or 4.2, as the case may be, have been received by the Agent. 5. ESCROW OF PROCEEDS 5.1 5.2 The Net Proceeds of the Initial Notes Issue shall be paid by the Issuing Agent into the Escrow Account. The funds standing to the credit on the Escrow Account shall be secured in favour of the Agent on behalf of the Noteholders. Upon the receipt by the Agent of the documents and evidences set out below, the Agent shall promptly release the Security pursuant to the Escrow Account Pledge Agreement and instruct the Escrow Bank to promptly transfer the funds standing to the credit on the Escrow Account in accordance with the funds flow statement provided by the Issuer: (a) (b) (c) (d) (e) (f) a duly executed release notice from the Issuer requesting the release of the Net Proceeds of the Initial Notes from the Escrow Account; the Intercreditor Agreement duly executed by all parties thereto; a confirmation signed by the Issuer that no Event of Default has occurred and is continuing or will result from the release of the Net Proceeds of the Initial Notes from the Escrow Account; copies of the constitutional documents of each Guarantor; copies of all corporate resolutions (including authorisations) of each Guarantor required to execute the relevant Finance Documents to which it is a party; the Guarantee Agreement duly executed by the parties thereto; 17
(g) (h) (i) (j) (k) all Finance Documents other than the documents evidencing the Condition Subsequent Security (unless already delivered and to the extent possible) duly executed by the relevant parties thereto; evidence that any existing debt, security and guarantees (that will not constitute Permitted Security or Permitted Financial Indebtedness) have been discharged or will be discharged in full prior to or through the release of the Net Proceeds of the Initial Notes from the Escrow Account; a funds flow statement setting out inter alia the use of the Net Proceeds from the Initial Notes Issue; an agreed form Compliance Certificate; and a letter from the legal counsel to the Joint Bookrunners confirming satisfaction of the conditions precedent set out in this Clause 5.2 addressed to the Agent. 5.3 5.4 5.5 The Agent may assume that the documentation delivered to it pursuant to Clause 5.2 is accurate, correct and complete unless it has actual knowledge that this is not the case, and the Agent does not have to verify the contents of any such documentation. If the Issuer has not provided the conditions precedent set out in Clause 5.2 to the Agent, on or before the Business Day falling thirty (30) Business Days after the First Issue Date (the Long Stop Date ) the Issuer shall redeem all, but not some only, of the outstanding Notes in full at a price equal to 101 per cent. of the Initial Nominal Amount of the Notes, together with accrued but unpaid interest (a Mandatory Redemption ), provided that the Issuer may in such circumstances at its sole discretion give notice to the Noteholders and the Agent at any time prior to the Long Stop Date of its intention to redeem the Notes at a price equal to 101 per cent. of the Initial Nominal Amount of the Notes in which case such redemption shall take place no more than five (5) Business Days after the effective date of the notice. The Agent may fund a Mandatory Redemption with the amounts standing to the credit on the Escrow Account. A Mandatory Redemption shall be made by the Issuer giving notice to the Noteholders and the Agent promptly following the date when the Mandatory Redemption is triggered pursuant to Clause 5.4. The Issuer is bound to redeem the Notes in full at the applicable amount on a date specified in the notice from the Issuer, such date to fall no later than ten (10) Business Days after the Long Stop Date. 6. CONDITIONS SUBSEQUENT 6.1 The Issuer shall, as soon as reasonably practicable but in any case (other than the Issuer Share Pledge, which shall be perfected on the Disbursement Date) not later than two (2) Business Days from the Disbursement Date, provide evidence to the Agent that the following Condition Subsequent Security has been duly executed, granted and perfected in accordance with the documentation evidencing such Condition Subsequent Security, along with legal opinions covering the laws of the relevant jurisdictions confirming the capacity and authority of the relevant parties to grant the relevant Condition Subsequent Security, the validity and the enforceability of the documents evidencing the relevant Condition Subsequent Security and the due perfection thereof: (a) first priority pledges over all shares issued by the Issuer and any Initial Guarantor (other than the Parent); 18